Latest California Budget Proposal Defeated. Legislature Locked In. Plug Pulled on Public Works Projects

Last night, the California State Assembly voted on yet another budget modification with some combination of spending cuts and raising taxes.  This modification was the one proposed by Governor Schwarzenegger.   Once again, the so-called Republicans in the legislature weren’t on board and there weren’t enough votes to pass the measure.  Here were the broad-strokes of the budget proposal, as reported in the LA Times:

The plan from Assembly Speaker Karen Bass (D-Los Angeles) would have raised $11.3 billion in revenue by raising the state sales tax by 1.5%, adding a tax on oil extraction and increasing taxes on alcoholic drinks — all ideas Schwarzenegger has proposed. The proposal would have reduced spending on schools and social programs by $6.9 billion.

The SacBee reports:

The spending cuts portion of the Democratic-sponsored plan fell six votes short of the two-thirds margin of 54 it needed in an initial tally. The tax hike portion fell eight short in initial voting as none of the 29 Republicans supported it.

The votes come the night before a state board is expected to suspend financing for hundreds of public work projects either underway or about to begin, costing thousands of jobs.

Why did it fail? The LA times says:

The plan’s reliance on tax increases ensured its rejection by the Republican minority, which has the power to block spending plans. Though GOP lawmakers rejected an earlier proposal that was more evenly balanced between cuts and tax hikes…

But if it was ensured to fail, why bother voting on it in the first place?   Assembly Speaker Karen Bass (D-Los Angeles/Culver City) had this to say to the LA Times:

Bass told reporters she was holding the vote because “if we don’t vote on anything, people feel we are doing nothing.”

Speaker Bass, we appreciate the honesty, but unless you’re going Bullworth on us or if this comment is part of some serious inside strategy, you’re really misreading the statewide mood. We already think you’re doing nothing, holding a useless vote only makes things worse.  Admitting to doing it for cosmetic or PR reasons  shows disdain for the people you are supposed to serve.  If it’s a joke, it didn’t translate in print and it’s still insulting.  Boo hiss.

But maybe we shouldn’t second guess Speaker Bass.  According to the SF Chronicle, after it became clear the budget proposal would be defeated, the Speaker pulled this move:

… rather than closing the final vote count on the measures and ending the floor session, Assembly Speaker Karen Bass, D-Baldwin Vista (Los Angeles County), announced that lawmakers were locked in, preventing them from leaving the Assembly floor and nearby meeting rooms.

Bass said she ordered the Republicans’ budget proposal to be ready in bill form so that lawmakers could vote on it Tuesday night. But it was unclear how long it would take for the GOP proposal to be ready.

And since there’s no new budget and no one in the legislature has figured out how to stop the state from running out cash by February, it looks like today is the day the plug gets pulled on public works projects.   The LA Times reports:

On Wednesday morning in Sacramento, Lockyer, state Controller John Chiang and Schwarzenegger’s finance director, Mike Genest, will meet to vote as members of the obscure Pooled Money Investment Board on a staff recommendation that new loans for construction projects be stopped and public agencies be barred from spending money they have already been given. The staff estimates that $3.8 billion in project funds would be affected.

“Exceptions may be made for specific projects,” Lockyer spokesman Tom Dresslar said in an e-mail, if the officials determine that “a financing cutoff would expose the state to unacceptable financial penalties, or prevent the state from paying required loan interest or administrative costs.”

If you want to see a big ‘ol list of the projects that are on the chopping block, click here.

Stay tuned…